Blow to Labour: Staffing problems threaten housebuilding targets

The construction industry has been hit by a “very sharp rise” in recruitment problems, dealing a major blow to Labour’s plan to build 300,000 homes a year.

Sir Keir Starmer has pledged to reform the planning system and set binding targets for councils to ensure 1.5 million homes are built over the next five years.

But a report by the British Chambers of Commerce suggests this may not be easy due to a “very worrying” shortage of workers.

This comes just days after FTSE 100 housebuilder Barratt Developments said it would build fewer homes this year.

The company, which hopes to merge with smaller rival Redrow in a £2.5bn deal, said it intends to build no more than 13,500 homes in the year to June 2025, compared with 14,000 the previous year.

The BCC said 82 percent of construction and engineering firms had difficulty recruiting staff between April and June.

Staffing costs are putting pressure on businesses, with 76 percent of construction and engineering firms expressing concerns, the report said.

BCC deputy director of public policy Jane Gratton said: “It is alarming that recruitment difficulties have increased in recent months across all sectors.

Of particular concern is the sharp rise in the construction sector.

‘Staff shortages and rising labour costs are putting pressure on businesses and holding back growth.

“We must prioritise helping people to get back into the labour market. Better skills planning is essential.”

The BCC survey of almost 5,000 businesses also found problems in the hospitality and manufacturing sectors.